Copyrighted imageCredit: BBC
As the world continues to feel the shakes and aftershakes of financial collapse, can the great economics thinkers who shaped the 20th century offer any way ahead for the 21st?

BBC Economics editor Stephanie Flanders wants to find out. Across three episodes, she introduces us to some of the primary thinkers in the field. She'll explain the world which shaped their ideas, the controverseys around some of their conclusions, and ask how well their prescriptions might be suited to the world in which we now find ourselves.

There are some surprises along the way - we'll discover why Karl Marx admired capitalism; how Keynes' view of German reparations after Versailles echo worries about Greek debt repayment in 2012; and why following Hayek's logic led to an American being labelled a "domestic terrorist".

Episode-by-episode

John Maynard Keynes - who believed that in a crisis, the government should spend money, even if it had to borrow to do so.

Friedrich Hayek - who felt that a recession should be allowed to run its course to correct the financial system

Karl Marx - like the others, Marx saw that capitalism was unstable, but unlike Keynes and Hayek, didn't think we had to live with it

Comments

Hello TOU,
I have just watched the three episodes of this series and found it both informative and enjoyable.
However, I found the commentary of the narrator was, at times, very difficult to understand. I can't recall hearing her perform commentary in any previous documentaries but I would have to say, given her strong accent and shrill voice, she was a poor choice to perform this role.
Fortunately, I had recorded the episodes and was able to rewind (sometimes 2 or 3 times!) to ascertain exactly what she had said. This tended to spoil the experience.
Please understand this is not a reflection of her competence or qualifications to cover such an issue, or her as a person.
Regards.

Masters of Money was a good look at the 3 major economist, but forgot a very important and all too often overlooked ‘the Capitalist Manifesto’ & ‘the New Capitalists’ authored by Louis O. Kelso & Mortumer J. Adler and published in the 1950s. I would suggest a good hard look at this gentler more humane form a capitalism. You can download both for free here http://www.kelsoinstitute.org/downloadable-books.html . May just be a form of capitalism we all can live with.

Excellent television and well presented. By way of background, I'm a British expat living and working in China, so I confess I had to download the program by devious means even to watch it. It was well worth the risk. Meanwhile I believe a have a less distorted picture of global economics than those who've lived exclusvely in the UK since I left in the early 1970s.

First thing that struck me was why there were only three programs? And why two from the left and one from the right? Is this evidence of what I read about "institutional bias" at the BBC? Frankly, I think so. A fourth program about Milton Friedman could have provided a fair sense of balance. Yet he was relegated to an asterisk position in the Hayak discussion. What a lost opportunity.

Still, taking the three programs as a single entity, I think the overall result was correct. But not necessarily the way the producers wanted it to be. Marxism was a dismal failure. End of story. The jury's been out about Keynes since 1931. Yet there are many people who believe Keynes was an active catalyst in the economic scenaria that led to WWII. Most recently, in our own global economic crisis, Keynesian economics has failed almost as badly as Marxism.

Hayak's ideas have never been given a forum to play out on. As the presenter said, his ideas are bit too scary for modern democratic governments to pursue. This isn't entirely true. The few countries that have tried even a sniff of Hayak (UK, USA, Switzerland, Estonia. etc) have all done better than those that totally ignored him (France).

If nothing else, this excellent program should start a dialog that may well lead to alternative ideas about how we can structure the socio-political-economic future we all have to live in.

Economics baffles me, as I suspect it does most economists. However, surely the basics of all modern economics is that a huge worldwide population takes raw material from nature, sells/buys it, then dumps it back as pollution. And this gets worse and worse; euphemistically called economic growth. Thus we can see the natural world is in a perilous state. Surely, a new and better economic system must be based on a much, much smaller world population – that takes care of nature and thus takes care of itself. As it is, instead of striving to bring about this new economy, almost all people are content to drift blindly on with the present system (capitalism or communism). Economists should be ecologists.

The Future of capitalism?
What is the future? The question was raised at the end of the third program. All we have, it can be argued is the ability to look at the facts of the past, in particular since the start of the Industrial Revolution and when real Capitalism started, which is what the series did very well. However it seems quite obvious that Capitalism cannot continue unabated as it forever. Simply take the current model and fast forward it? We are already out stripping the planets resources at an unsustainable rate. More children = more resources required which cannot be sustained indefinitely?
View the planet as a single business, what is its possible Total Capacity, maximum number of humans it can support, most futurists believe at 10 billion the figure will level out, just one generation ago there were only 2 billion in total? What has fuelled this incredible growth, yes modern farming and health products (wonder drugs) would they have evolved without Capitalism? As Marx predicts, Capitalism has to ‘implode’, in fact at a much faster rate than we are probably comfortable with! Within this or the next generation the human race will crack the secrets of fusion, be able to build affordable fusion generators all over the planet, and although initially high costs will be incurred, eventually we will have on tap ‘free energy’, which initially may seem wondrous, where will Capitalism be lead then (without vigorous control)? By the very nature of greed we will not be able to sustain a balanced equilibrium between what we need and what we want. Do we stop when every one of our 10 billion residents has a large house, 2.4 children, SUV car, huge 50” TV, perfect healthcare??
Capitalism is fundamentally flawed and will end soon. What was mentioned briefly in the program was that “we cannot model Capitalism, the world’s most powerful computers cannot predict it” this is simply not true, all large systems (whether, planets, evolution, etc) are governed by chaos but can be modeled!
A possible future: Has anyone watched Star Trek, they have jobs, but are not employed, they work for each other and the remuneration is knowledge. With free energy we will have the opportunity to explore the depths of our dreams, but can they be controlled?

Well we just need the Friedman episode to complete the set- he and the Chicago boys used KM's analysis as a capitalist template.
By the way I visited Marx's birthplace in the 70's. It was a locked-up scruffy little house with badly presented artifacts, and struggling financially. It had opened just after war, after an appeal to leftist parties worldwide. On display were all the good wishes and offers of help- apart from the miserable reply from the British Labour Party international secretary- one Denis Healey, explaining how times were hard and they couldn't afford anything!

A concept, similar to Hayek, of private property, free labour, free enterprise, free consumer choice, and ubiquitous competition dates back to the theory of ‘laissez faire’ (‘let it be’) which has known origins in the seventeenth century. Such a system fell afoul of the conflict of individual and social interests. To such an extent, laws were passed in the 1800s to protect workers life, limb, health and human rights. Also, failure of companies to act in an honest, moral manner as well as well as act in the interests of society lead to a decline of laissez faire.

There are parallels, I feel, to be drawn to the system of laissez faire and Hayek and there can be seen a pattern of behaviour in allowing markets to be ‘free’, experiencing both potential market efficiencies and abuses.

I agree 100%. Thank God Mother Nature hasn't heard about this "laissez faire" nonsense. Can you imagine what the world would be like if it was left to "survival of the fittest" to evolve? Good grief! Now if nature followed Marx, there would only be one species and we'd all be exactly 1.8M tall. Nobody would be better (off) looking than anyone else and we'd have standardised genitalia.

What a wonderful world it would be.

BYW: I imagine Mother Nature dates back before the 17th century but I'll be happy to defer to your references.

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